Truth Social CEO Devin Nunes speaks at the Conservative Political Action Conference (CPAC) in National Harbor, Maryland, USA, Thursday, March 2, 2023.
Al Drago | Bloomberg | Getty Images
Citadel Securities torn Trump Media Chief Executive Devin Nunes sent a letter to the Nasdaq on Friday, citing Citadel Securities and other major market companies, after he warned of possible illegal short selling in DJT stock .
“Devin Nunes is a known loser who attempts to blame his stock price decline on ‘naked short selling,'” a Citadel Securities spokesman said.
“Nunez is exactly the kind of person Donald Trump would fire on ‘The Apprentice,'” a spokesman said of the former Republican president’s business competition reality show.
“If he (Nunez) worked at Citadel Securities, we would fire him because competence and integrity are at the core of everything we do,” the spokesperson added.
Pavlo Gonchar | Light Rocket | Getty Images
A Trump Media spokeswoman told CNBC: “Citadel Securities is a corporate giant that has been fined and reprimanded for an extremely wide range of criminal conduct, including issues related to naked short selling. And is famous for deceiving ordinary retail investors in the stock market.”
Nunes’ letter to Nasdaq CEO Adena Friedman comes as Trump Media has given shareholders detailed instructions on how to avoid being bet on their stocks Short sellers take advantage as DJT price will fall.
Although Trump Media shares have risen strongly over the past three days, they are still trading about $26 below their March 26 debut opening price.
The company had revenue of just $4.1 million last year, but has lost billions of dollars in market value as its stock price fell.
“I am writing to draw your attention to potential market manipulation of Trump Media Technology Group’s stock,” Nunes told Friedman in the letter.
Nunes said Trump Media prices have been used in so-called naked short selling, a practice in which traders sell shares of companies that the seller did not actually borrow for the purpose.
Nunes said brokerages had a “huge financial incentive to lend non-existent shares” to short sellers because they were able to charge unusually high premiums for such loans of DJT shares.
“The data we obtained indicates that just four market participants account for more than 60% of DJT stock trading volume: Citadel Securities, VIRTU Americas, G1 Execution Services, and Jane Street Capital,” Nunes wrote.
Citadel Securities was the only one of the four firms to comment on Nunes’ letter, and the strong language in its response was shocking, especially given the political affiliations of those involved with Trump’s media and Citadel Securities.
Nunes is a former Republican congressman from California. At the end of 2021, he resigned as a member of the House of Representatives and became the head of the then privately held Trump Media Company. The company became publicly traded last month following a merger with a shell company.
Republican presidential candidate Trump is the largest shareholder of Trump Media, holding nearly 60% of the shares.
The founder and non-executive chairman of Citadel Securities is Ken Griffin, who has been a major donor to Republican candidates.
Griffin donated $5 million to a political action committee supporting former South Carolina’s Nikki Haley’s unsuccessful bid for the Republican nomination against Trump.
According to Federal Election Commission filings, Griffin donated $5,800 to Nunes’ congressional campaign in September 2021, three months before Nunes said he would resign to become Trump Media CEO.
-Additional reporting by CNBC Brian Schwartz
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